Accounting managerial homework help?

Posted on 2014-04-22 08:44:00 in Management by ELIZA

I need help finding these two problems



Assume that management wishes to improve profitability by increasing prices on selected products. At what price would High and Good grades need to be offered in order to produce the same relative profitability as Regular Grade steel?



Revised Price of High Grade Steel $

Revised Price of Good Grade Steel $



This is what I have answered:



1. Determine the unit contribution margin for each product.



Contribution margin

per unit

High Grade $ 40

Good Grade $ 5

Regular Grade $ 30



2. Provide an analysis to determine the relative product profitability, assuming that the furnace is a bottleneck. If required, round your answers to two decimal places.

Contribution margin

per furnace hour

High Grade $ 8

Good Grade $ 1.25

Regular Grade $ 10

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